It has been barely a month since Apple released the new iPad. There are already rumours, though, of the release of a smaller version of the best-selling tablet - a mini iPad. In fact, such rumours have actually been around since the first iPad was launched. Now, however, it seems Apple really does intend to release a 7-inch tablet, later this year, to compete with rivals like Amazon, Google and Microsoft.

Check out a round-up of rumoured features

Specifications: Given the expected size of this mini iPad, it could well function more as a smartphone than a tablet. It should come with a 7.85-inch screen and sport the same resolution as the new iPad. However, a report on T3 suggests the screen size of the mini iPad could drop to 5-inches.

Release Date: Apple could launch the mini iPad in the third quarter of the year. Information from T3 has sources stating the company could look to compete with Windows 8 tablets and Foxconn and Pegatron have already begun receiving orders.

Suggested price: The mini iPad could be priced at somewhere between £150 ($249) and £185 ($299), approximately, according to a report on Chinese Web site NetEase. Similarly, analysts at HIS iSuppli estimate a smaller tablet will cost approximately £155 to produce; this is excluding development costs, packaging and patent royalties, reports the Herald Sun.

"The first thing you always have to keep in mind is: Apple is not going to sell an unprofitable product," said Rhoda Alexander from iSuppli. Therefore, the suggested retail price of the mini iPad could be, approximately, £200 ($329) or £216 ($349).

Difficulty for Developers: A smaller iPad may create difficulties for software developers.

"Going to a different screen size ends up being a ton of work. If you take, for an example, an interface built for the iPad and try to cram it into the Kindle Fire, it just does not fit," said Nate Weiner, the creator of Pocket, an iPhone app. However, he did add it should not be difficult to adapt for developers who have already made apps for other 7-inch tablets, like the Kindle Fire.

Benefits of a Smaller iPad: The mini tablet market could soon see intense competition from the likes of Amazon and Google, as well as Apple. Therefore, properly produced, the mini iPad could help Apple to a healthy lead in the tablet market.

"From a competitive standpoint, we believe an iPad mini with a lower price would be the competition's worst nightmare. Most (competitors) already have enough times competing against the iPad 2 as well the new iPad," said Shaw Wu, an analyst at Sterne Agee.

Apart from a lower price, which is the primary reason customers are likely to opt for smaller tablets, another reason could be that such a device would fit into handbags easier than any of the present models.

Steve Jobs on the Mini iPad: "The reason we would not make a 7-inch tablet is not because we do not want to hit a price point, it is because we do not think you can make a great tablet with a 7-inch screen. The 7-inch tablets are tweeners, too big to compete with smartphone and too small to compete with an iPad," said Steve Jobs, the late former founder and Chief Executive of Apple.

"There are clear limits of how close you can physically place elements on a touchscreen before users cannot reliably tap, flick or pinch them. This is one of the key reasons we think the 10-inch screen size is the minimum size required to create great tablet apps," Jobs once said.

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